infonet-economy

We develop a new tail risk measure for hedge funds to examine the impact of tail risk on fund performance and to identify the sources of tail risk. We find that tail risk affects the cross-sectional variation in fund returns, and investments in both, tail-sensitive stocks as well as options, drive tail risk. Moreover, managerial incentives and discretion as well as exposure to...

Power-to-gas (P2G) is a technology that converts electrical power to gas fuels like methane for storage in the natural gas grid. Due to the low efficiency, the production of synthetic methane is only profitable if electricity is sufficiently cheap. However, P2G facilities are flexible consumers and can benefit from short-term price fluctuations on the electricity spot market. We use...

Ein externer Verwaltungsrat (VR) kann familiengeführten KMU als Sparringpartner dienen, eine Aussensicht einbringen und dadurch die Betriebsblindheit reduzieren. Zudem wird an Themen gearbeitet, welche die Zukunft der Firma betreffen. Neben den grossen Chancen gibt es jedoch einige Voraussetzungen, damit ein externer VR in KMU auch seine Schlagkraft entfalten kann.

Access to external funds is crucial for the entry and expansion of entrepreneurial firms and the sectors they predominantly arise in. This paper reports three important results. First, comparative advantage is shaped by factor endowments as well as fundamental determinants of corporate finance. In particular, a larger equity ratio of firms and tough governance standards relax...

We document a drift in exchange rates before monetary policy changes across major economies. Currencies tend to depreciate by 0.7 percent over ten days before policy rate cuts and appreciate by 0.5 percent before policy rate increases. We show that available fixed income instruments allow to accurately forecast monetary policy decisions and thus that the drift is foreseeable and...

Nicht grosse Unternehmen ab 250 Mitarbeitenden dominieren die Schweizer Unternehmenslandschaft, sondern sogenannte Klein- und Mittelunternehmen (KMU): 99.8% der Unternehmen in der Schweiz gelten gemäss den neusten provisorischen Zahlen des Bundesamtes für Statistik als KMU. Dabei sind die Kleinst- oder Mikrounternehmen mit weniger als zehn Mitarbeitenden mit 92.4% der Unternehmen die...

Almost all important decisions in people’s lives entail risky consequences. Some of these decisions involve events that materialize with a low probability but lead to extreme consequences such as loss of total wealth or accidental death. When facing such rare extreme events, people display considerable risk aversion in some situations whereas in others the opposite is the case. For...

This paper investigates the impact of investor information on financial innovation. We identify specific channels through which issuers of financially engineered products exploit retail investors by using their privileged access to information. Our results imply that imperfect investor information regarding volatility and dividends is crucial to explain the pricing and design of...